In the first six decades of the 20th century, songwriter Irving Berlin's dominion over American pop culture was matched only by his stranglehold on the nation's rags-to-riches mythology. His story began in classic American fashion - in desperate poverty, on a continent half a world away - and the rest of his life stayed true, with improbable fidelity, to the conventions of a Hollywood fable: the bootstrapping immigrant remade in the crucible of showbiz.

Berlin lived all the cliches: the flight from a pogrom-scourged corner of Siberia; the steerage-class journey to the new world; the hard-scrabble childhood on Manhattan's lower east side; the big break; international fame, unimagined fortune. The Gatsbyesque drama of his self-invention can be tracked in his pseudonyms.

Berlin was born Israel Baline, but by the age of six had a jaunty nickname, Izzy, with those twin Zs evocative of American jazz and pizzazz. When he ran away from home as a 13-year-old boy, he signed guest registers in Bowery flophouses as Cooney. The name he made famous was given to him by chance, when his first published song, written while he was a 19-year-old singing waiter in a Chinatown saloon, rolled off of sheet-music presses with a fateful misprint: "Words by I Berlin."

Of course, the lives of many famous entertainers have traced a gutter-to-penthouse trajectory. But not even the immigrant upstarts who invented Hollywood can be said to have achieved Berlin's feat: a single-handed colonisation of the American imagination. Years before he became a US citizen, Berlin - who chose the name Irving because he thought it sounded classy - had established himself as his adopted country's troubadour. He wrote thousands of songs and had more than 400 hits, among them some of the most tuneful and beloved in American popular music: "Alexander's Ragtime Band", "Always", "Blue Skies", "Puttin' on the Ritz", "Cheek to Cheek".

Other titans of Tin Pan Alley left behind illustrious songbooks. Yet, while Berlin could write melodies as lovely as Jerome Kern's, conjure moments of bluesy grandeur worthy of Gershwin and produce lyrics to match Cole Porter at his witty best, none of those composers rivalled Berlin at his speciality: tapping into the collective unconscious to produce Big American Songs. He gave the US its great Easter song ("Easter Parade"). He wrote two enduring odes to pillars of American civic religion: hand-on-heart patriotism ("God Bless America"), and tongue-in-cheek mass entertainment ("There's No Business Like Show Business").

Berlin's biggest hit of all was his grandest secular hymn: "White Christmas". Today, nearly everybody knows Berlin's melody but few realise who wrote it - thanks to its creator's knack for producing pop tunes that sound as timeless and inevitable as folk songs. Where "Rudolph the Red-Nosed Reindeer", "Silver Bells" and other seasonal songs are unmistakably products of the 20th century, Berlin's tune nestles in nicely with most ancient and anonymous hymns and carols. It sounds like something that has always existed - a song discovered on a hillside, beside a babbling brook.

But "White Christmas" is, supremely, a pop song. Begun in mid-1938 as a novelty tune, completed in 1940 as a straightforward sentimental ballad, released in August 1942 in a movie musical, "White Christmas" was Berlin's happiest accident: a throwaway tune that became the world's top-selling, most frequently recorded song. Estimates of its sales range from 125m to 400m copies. It is a quintessentially American song that the world has embraced. Among the untold hundreds of recordings are versions in Hungarian, Japanese, Swahili and, in a knowing nod to its creator's pedigree, Yiddish.

Bing Crosby's original Decca Records single remains a music-industry landmark. For over 50 years it stood as the bestselling record in history. Introduced in the film Holiday Inn (it won the Academy award for best song), Crosby's "White Christmas" topped the hit parade for nearly three months. It re-entered the survey every December for 19 of the next 20 years. All told, Crosby's recording has sold over 31m copies. It was not unseated from its place in the Guinness Book of World Records as the all-time top single until Elton John released "Candle in the Wind 1997".

The song's power, however, is about more than world-beating sales figures. "White Christmas" spoke eloquently to its historical moment, offering a comforting holiday vision to a world at war. It was US soldiers, facing the prospect of a decidedly un-white Christmas in north Africa and the Pacific, who first embraced the song and spurred its chart-topping run.

But "White Christmas" also resonated with some of the deepest strains in American culture: longing for an idealised New England past, belief in the ecumenical magic of the "merry and bright" Christmas season, yearning for the sanctuaries of home and hearth. Its soft-focus scenery - those vaguely Victorian images of sleigh rides and falling snow and eager children - resonates with the anglophile US imagination as the essence of the traditional Christmas.

And with his dream of a white Christmas, Berlin minted a new holiday ideal. The anticipation of a Christmas snowfall, now keenly felt everywhere from New Hampshire to New Guinea, seems to have originated with Berlin's song. London bookmakers didn't offer odds on the possibility of a white Christmas prior to "White Christmas".

If "White Christmas" offers a one-song primer on Berlin's songwriting strengths, it also exposes his most exasperating weakness: a taste for sentimentality that grades into outright schmaltz. Crosby, a genius at pitching his performances, manages to hold art and schlock in perfect balance. His pining for Christmases "just like the ones I used to know" has the starkness and melancholy of a true cry from the soul.

Alas, that same key line has returned, in recording after recording, as kitsch. "White Christmas" is still a magnet for the most garish over-emoters, among them Barbra Streisand, who wield ballads like bludgeons. It has come to symbolise, for many listeners, the white-bread tackiness of Berlin's musical era, the phoniness and rot that rock and soul swept away in a great cleansing wave of rhythm and truth. Tellingly, "White Christmas" became a flashpoint of the intergenerational culture battle when Berlin tried to ban Elvis Presley's 1957 recording of the song - a rollicking version that the songwriter churlishly called a desecration.

Today, that clash of generations colours our view of musical history. Most pop critics, steeped in rock's rebel mythologies and cult of authenticity, view "White Christmas" as a totem of the fuddy-duddy music that ruled the airwaves before the good stuff came along. To those of us who grew up with punk and hip-hop and techno, Berlin seems like a creature from another planet: the crowd-pleasing bourgeois that rock culture abhors.

But "White Christmas" is the result of a social struggle as colourful as those that have influenced rock's development. After all, the modern pop song was created in turn-of-the-century Manhattan by Jews - many, like Berlin, recent immigrants. The music they gave the world was a soundtrack of assimilation, the result of a marginal people's striving for acceptance and a piece of American pie. "White Christmas", a Russian-born cantor's son's ode to a Christian US holiday, is a tribute to that effort. It is a symbol of how the Jewish people - who wrote pop songs, sang them on vaudeville stages, invented Broadway and founded movie studios - turned themselves into Americans and remade pop culture in their own image.

In his novel Operation Shylock , Philip Roth exults in the "Jewish genius" of "White Christmas": "God gave Moses the 10 Commandments and then He gave Irving Berlin 'Easter Parade' and 'White Christmas'. The two holidays that celebrate the divinity of Christ - the divinity that's the very heart of the Jewish rejection of Christianity - and what does Irving Berlin brilliantly do? He de-Christs them both! Easter turns into a fashion show and Christmas into a holiday about snow."

Roth's joke rings true: the placid sound of "White Christmas" masks an achievement of astonishing bravery. Asked in a 1954 interview how he, "a member of the Jewish faith", could have written a Christmas song, Berlin was blunt. "I know how," he said. "I wrote it as an American." At a time when anti-semitism and nativism were grim realities of national life, Berlin scorned the notion that any part of the US's heritage was off limits to him. He not only staked claim to the American present, but dared to dream himself back into hallowed past times, "just like the ones I used to know".

There is a word for this, and it is Yiddish: chutzpah. In its own subtle way, "White Christmas" is a musical gesture as aggressive as "Anarchy in the UK" or anything on Eminem's The Marshall Mathers LP . Listening to the song's lulling, maudlin, immemorial strains, we hear something more than just a seasonal standard: the toughest punk anthem ever to masquerade as a Christmas carol.